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SUPERVALU Slips to 52-Week Low as CEO Plans to Step Down

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Grocery retailer SUPERVALU Inc. 's SVU share prices plunged to a 52-week low of $6.75 on Oct 2, 2015 after its turnaround driver, Sam Duncan, announced the prior day that he will retire from his current position of President and Chief Executive Officer (CEO) of the company effective Feb 29, 2016, following the end of fiscal 2016.

Why the Shares Fell?

Investors are skeptical about the prospects of SUPERVALU after its CEO steps down. Duncan has been serving as the President and CEO since Feb 2013, following the sell-off of five retail grocery banners to Albertson's. A veteran retail and grocery executive, he had earlier spearheaded turnarounds at other companies, like Shopko and OfficeMax.

After Duncan took over the helms of SUPERVALU, this Eden Prairie-based company regained some momentum on the back of cost cuts and competitive pricing. Duncan also introduced decentralized grocery store management. His cost reduction initiative included 1,000 corporate job cuts in 2013, 600 of them were in Minnesota.

The company reported better-than-expected earnings and sales in the first quarter of fiscal 2016, backed by higher comps in retail, Save-A-Lot stores and the independent business. The company plans to spin off its Save-A-Lot stores into a separate publicly traded company to increase operating efficiency.

SUPERVALU also announced two promotions at the executive level. While Bruce Besanko has been promoted to the newly created role of Executive Vice President, Chief Operating Officer (COO), Susan Grafton has been appointed as the Executive Vice President, Chief Financial Officer, effective immediately. While Besanko will report to Duncan, Grafton will be reporting to Besanko.

SUPERVALU currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the consumer staples sector are Cal-Maine Foods Inc. CALM , Post Holdings Inc. POST and Omega Protein Corporation. OME . While Cal-Maine Foods sports a Zacks Rank #1 (Strong Buy), Post Holdings and Omega Protein have a Zacks Rank #2 (Buy).

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SUPERVALU INC (SVU): Free Stock Analysis Report

CAL-MAINE FOODS (CALM): Free Stock Analysis Report

POST HOLDINGS (POST): Free Stock Analysis Report

OMEGA PROTEIN (OME): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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